International Monetary Fund Slashes 2014 Global Growth Forecast

China asks IMF to grant more power to emerging market economiesReuters

The International Monetary Fund slashed its global economic growth forecast for 2014 after the world's two biggest economies showed weakness in the early part of the year.

The US and China have suffered from weak growth and slowing domestic demand respectively.

While some of the factors behind the reduction were temporary, some richer nations face prolonged economic stagnation if they do not act to boost growth through deeper reforms, the IMF warned.

Updating its World Economic Outlook, the IMF said the global economy should grow at 3.4% this year, down 0.3% on its April prediction. Yet, the Fund's prediction for global growth in 2015 remains at 4%.

"Robust demand momentum has not yet emerged despite continued very low interest rates and easing of brakes to the recovery, including from fiscal consolidation or tight financial conditions," the IMF said.